CHAPTER ONE

INTRODUCTION AND BACKGROUND OF THE

ORGANIZATION.

1.0 Introduction and Overview of field placement

This chapter explains and reviews taxation in general, the history of taxation in the Tanzania,
current tax regime in Tanzania, and finally the Tanzania Tax Administration.The main objective
of the field practical training was to integrate theory knowledge acquired during class periods
with practical work obtained from working environment. My field work started from 14th
September 2020 to 06th September 2020 at TRA Samora Motor Vehicle ( ILALA TAX
REGION ) in Non Revenue Section.

DRD is one among TRA Departments which started its operation in the year 2005. Before its
establishment there were two independent tax departments, Income Tax Department and Value
Added Tax Department which joined to form DRD with the responsibility of administering
taxes, duties and levies of the Central Government. At a regional level all taxes are assessed and
collected under the leadership of the Regional Managers assisted by Assistant Managers - Audit
and Assistant Managers-Debt Management and Compliance Monitoring.

Ilala Tax Region is one of the TRA tax regions basically collecting revenue from domestic
sources covering the whole of Ilala area and due to sensitivity of Motor Vehicle section the
buildings are available at Samora area and not at Mapato House where Ilala Tax Region other
activities operates.

1.1 Background of the Organization.

The Tanzania Revenue Authority (TRA) is semi-autonomous in situation established to
assess, collect and account or the central government revenues. TRA was established by the
Act of Parliament No.11o f1995, and started its operations on 1st July1996.Prior to 1996 tax
administration in Tanzania was under three revenue department Which were income tax
department, value added tax department and customs and Excise department which operated
under the civil service frame work. The ministry of Finance was responsible for the control

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and direction of those independent departments. In determining to improve the revenue
collection situation, the government decided to modify the tax administration system.
Through the government fiscal policy which was setup to enhancerevenue collection
andimprove expenditure.

1.2. TRA’s Vision

Generally, vision provides a clear picture on how the organization will be in the future. The
vision of an organization gives an answer to a “What” question thus what is an aim of that
particular organization. “To increase domestic revenue through enhancement of voluntary
tax compliance.” Is the vision statement of TRA.The Tanzania Revenue Authority wishes to
make their customers who are the taxpayers to be able to adhere willingly in the matters relating
to tax that means to have a clean sheet tax compliance history.

1.2.1 TRA’s Mission

“To make it easy to pay tax and make life better.”Is a statement of TRA mission, this means
that Tanzania Revenue Authority main purpose is to serve their customers in an easy way in such
a way that the taxpayers lives will also be improved. One among the canon of a good tax system
is convenience meaning that every tax ought to be levied at a time in a manner in which it is
most likely to be easy for the contributer to pay it a good example here is the collection of
income tax from employment through PAYE.

1.2.3 MAJOR PRODUCTS, SERVICES PROVIDED AND PERFORMANCE

OF THE ORGANIZATION.

1.2.3.1 MAJOR PRODUCTS

The major product of TRA is tax, which is divided into two major types those are direct tax and
indirect tax. Direct tax are charged directly from the income of a person for example; PAYE tax
while the indirect taxes are mainly charged from consumption and on value added in each stage
of the production chain meaning from the manufacture to the whole seller followed by the
retailer and in the end the final consumer. Some examples of in direct taxes are Value Added Tax
(VAT), Skills and Development Levy, Excise Duty and Import Duty, to mention are few.

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1.2.3.2MAJOR SERVICES PROVIDED

There are series of services provided by Tanzania Revenue Authority to its customers who are
the tax payers as follows:

-Registration, this is a process whereby a particular individual is identified by the TRA as a tax
payer by being registered in the system. The process of registration enables a person to obtain a
TIN which is a unique identification that distinguish the tax payers from one another. A person
may be registered on VAT, presumptive tax system and owning a motor vehicle. Furthermore
the registration is only for sound mind persons and not otherwise. The process of registration can
be done online or going directly to the TRA’s office in case of any inconviniences.

-Tax assessment ,this is a process of determining the correct amount of taxable income from a
registered person ( an individual or a company ). According to the Income Tax Act, 2004 which
undergo several revised edition to 2008 section 94 there are three types of tax assessment which
are; Self assessment here a taxpayer by himself or herself compute the amount of taxable
income. Secondly is Adjusted assessment whereby a self assessment will be revised or
recomputed if there is a lack from some adjusted documents and this is done by the
Commissioner General or an appointed tax officer on his behalf. The last one is Jeopardy
assessment this assessment is done by the Commissioner General to those taxpayers who did not
prepare the assessment at all this is done at any moment to secure the public benefits.

-Tax clearance, this is a certificate issued to a legal person who has no tax due. The certificate
maybe issued for all taxes or taxes specified by the business. The purpose of tax clearance
scheme is to ensure that government contracts, grants and state licences are only given to
individual and businesses that are tax compliant. It is written confirmation from the Revenue that
a person’s tax affairs are in order at the date of issue of the certificate.

-Tax audit is an examination of persons return by Internal Revenue Service to verify that
person’s income and deductions are accurate. Types of audits are correspondence audit which is
the most common form of audit, Office audit, Field audit this is the most comprehensive and
detailed audit and the other type is Taxpayer Compliance Measurement Program ( TCMP ).

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-Tax refund, this is amount of money paid back to the taxpayer , the most common tax refund is
VAT Refund, whereby a taxable person will be entitled to a refund of VAT when in a particular
prescribed accounting period when his tax liabilities are not exhausted by allowable deductions.
The refund once is processed is paid to the taxpayer through Interbank Settlement System
(TISS).

1.2.3.3 PERFORMANCE OF THE ORGANIZATION

The main target of Tanzania Revenue Authority is toraise the revenue and the organization
performance will be determined by the amount the collect in each passing year. There are four
installments of tax collection each year beginning from 31 st March, 30th June, 30th September and
31st December that is first to fourth installment respectively. The summation of these installments
gives the annual collection of a respective year. The collection are grouped into four groups
which are Direct Domestic Revenue, Indirect Revenue, Custom and Excise duties na Large tax
payers. The following is the bar graph showing the amount of revenue collected from 1997 to
2019 the vertical side showing the amount of revenue collected in millions Tshs and the
horizontal side shows the year of collection.

1997/19 1998/19 1999/20 2000/20 2001/20 2002/20 2003/20 2004/20 2005/20 2006/20
98 99 00 01 02 03 04 05 06 07

672,333 709,288 706,577 732242 897981. 1,131,6 1,330,3 1,082,1 2,034,4 2,577.25
.8 7 74.5 08.8 66.0 45.6 1.6

2007/20 2008/20 2009/20 2010/20 2011/20 2012/20 2013/20 2014/20 2015/20 2016/20
08 09 10 11 12 13 14 15 16 17

3,378,7 4,051,9 4,437,9 10,702,4 6,502,5 7,750.5 9,383,0 8,357,1 10,702, 14,009,5
85.2 83.1 33.4 88.1 99.7 10.8 46.7 10.3 490 90.4

2017/2018 2018/2019

15,1991,421 11,3991,138.2

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1.2.4 Domestic Revenue Department.
Ilala tax region is divided into sections, some of which are directly related to revenue collection
and other stands as supportive section as follows:

1.2.4.1 Non revenue section

This is a special section dealing with collection of taxes and all TRA revenues that are non tax
revenue like billboards and others, it is divided into sub sections that is Enforcement and Block
sections.The main objective of blocks is to ensure efficient taxpayer monitoring on tax laws
compliance including the payment of required individual tax and corporate tax, registration for
TIN and VRN and ensuring all responsibilities are full filed in the block.

1.3 Primary functions of TRA

-To Assessing, collecting and accounting for all Central Government Revenue, the
authority is a Semi-autonomous organization that has the duty to determine and collect
all revenue especially of tax nature for the central government to meet its public
expenditure. Due to economic and social development the government collect tax to
finance development services like building and buying facilities in hospitals, building
schools and national defense.

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 -Administering and enforcing effectively all Tax laws in the nation to increase revenue
collection on different sources. This is crucial because without proper administration and
enforcement of tax laws which guide methods and to whom tax supposed to be collected
a lot of people could be avoiding paying tax. So the authority has a responsibility to
ensure that tax collection activities are smoothly done.
-To advice the Government on all matters related to fiscal policy, the authority has the
function of giving necessary advice to the government on what to be done or to avoid in
relation to fiscal matters. Like expansionary fiscal policy where tax rates are normally
reduce and government expenditure are increased or contractionary fiscal policy where
tax rates are increased and government expenditure are reduced.
-To promote voluntary tax compliance, through various education and seminars to tax
payers so as to increase revenue collection for better welfare. Also there are some favor
to those taxpayers with good tax compliance history concerning tax issues a good
example is being able to get a deferral payment on imported goods, which most of the
time the service requires a lot of money at a time. This is advantageous to only those
with good compliance history and not otherwise.
-To counteract tax frauds like evasion and avoidance which are major threat to the
revenue collection, this is by formulating strict policies that combat, reduce or eliminate
any kind of frauds as to ensure sound revenue is obtained.

Other functions of TRA are to produce trade statistics and publications, Improve the quality
of services to the taxpayer, Corporate with the tax payers and other stockholders on
different matters, recruiting competent staff for better quality services and manage all
complains from tax payers and stockholders.

1.3.1 Functions of non tax revenue section

Every activity performed under this section aimed at:

1.3.1.1 Simplifying the assessment process and to ensure that taxpayers pay their correct
amount of tax as per their sales records or turnover.
1.3.1.2 Identifying different kind of tax frauds from tax payers within the tax region this is
from surveillance and work out on such frauds for reasonable revenue collection.
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 1.3.1.3 Monitoring all outstanding taxes from tax payers tax position and ensure all taxes are
paid in a specified period of time.

Other section in the Tax Region includes

EFD Section, Registry section, Examination Section, Tax payers education, Section, Audit and
technical service section, Data entry block section and Customer care section.

1.4 Figure 1; Organization Structure of Tanzania Revenue Authority

Organization Structure of Tanzania Revenue Authority

Source; TRA (2019)

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1.5Review of the industry
The Tanzania Revenue Authority incorporates with other organizations that relate with revenue
generation from peoples income that is from business, employment and investment incomes.
Some of the organizations include municipal council in issues of business license and other
related matters, BRELA in issues of business registration, traffic and many other governmental
and non-governmental offices.

In this subtitle you have to entail about stakeholders within the industry such as customers,
suppliers, and competitors; barriers to entry into or exit from the industry; etc.

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 CHAPTER TWO
WORKDONE AND LESSONS LEARNT

2.0 Introduction
This chapter explains the tasks undertaken and lesson learned during the practical training at the
Tanzania Revenue Authority Samora Motor Vehicle ( Ilala Tax Region).

2.1 Description of tasks undertaken.

Most of the activities performed aimed at enforcing block taxpayers on proper compliance to tax
laws, the following tasks were undertaken together with lessons learned from each task.

2.1. Motor Vehicle New Registration

Manual recording of newly registered motor vehicle in a special book of registration that has
several columns of a name of the tax payer who is the owner of that registered motor vehicle,
TIN, motor vehicle registration number, card number offered by the authority, amount paid for
registration, reason ( which is new registration ), telephone number, name, signature and the date
where the card is taken, those particulars are for the one who will come to take the registration
card from our office because sometimes a motor vehicle owner can send a representative to take
a card on his or her behalf so for any inconvenience the one who came to take the card will be
held answerable.
Lesson learnt.

Before any motor vehicle is permitted to work on roads it should first be registered. The owner
him or herself or if he or she used import agents, they will be required to bring the release order
from port where the vehicle was firstly landed which has TANSAD number of TANCIS,
assessment, TBS, NIT documents which all these will show us that the vehicle is safe for use in
our country. For an individual he or she will be required to bring his photo copy if National
Identity card as well as passport size photo but for the case of company certificate of registration
and photocopy of ID’s of two directors as well as their passport size. The amount paid for
registration differ from one motor vehicle to another since their “cc” also varies therefore the
amount range from Tsh 300,000/= to Tsh 550,000/=.

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2.1.2 Motor Vehicle Deregistration
Manual recording of deregistered motor vehicle in a special book of registration that has several
columns of a name of the tax payer who is the owner of that deregistered motor vehicle, TIN,
motor vehicle registration number, card number offered by the authority, amount paid for
registration, reason ( which is deregistration ), telephone number, name, signature and the date
where the card is taken, those particulars are for the one who will come to take the registration
card from our office because sometimes a motor vehicle owner can send a representative to take
a card on his or her behalf so for any inconvenience the one who came to take the card will be
held answerable.
Lesson learnt

Deregistration is done to those motor vehicles which are either scrapped and no longer capable
for use and sometimes due to road accident the vehicle is regarded as a scrapper or exportation
reasons. For scrapped vehicle a tax payer is required to bring vehicle inspection report from the
police and if the car was scrapped due to road accident he or she should bring diagram offered by
the traffic police to show the validity of the accident together with vehicle inspection report,
photocopy of national ID, original registration card and one passport size. In case of exportation
a tax payer is required to bring the Interpol letter offered by the Ministry of National Affairs
which will show where the vehicle is exported to, vehicle inspection report, photocopy of ID,
original registration card and one pass port size. No deregistration will be done if either of the
requirement is missing. No amount is charged for motor vehicle deregistration.

2.1.3 Motor Vehicle Re-registration

Manual recording of Re-registered motor vehicle in a special book of registration that has several
columns of a name of the tax payer who is the owner of that Reregistered motor vehicle, TIN,
motor vehicle registration number, card number offered by the authority, amount paid for
registration, reason ( which is Re-registration ), telephone number, name, signature and the date
where the card is taken, those particulars are for the one who will come to take the Re-
registration card from our office because sometimes a motor vehicle owner can send a
representative to take a card on his or her behalf so for any inconvenience the one who came to
take the card will be held answerable.

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Lesson learnt.
Motor vehicle Reregistration is done to those vehicles which were deregistration and now the
owners of those vehicles wish to return them on their normal use. When a scrapped motor
vehicle is repaired the owner should bring the vehicle to the authority for inspection, submit EFD
invoice from the garage where he or she did the repairmen and if the insurance company paid for
it tax invoice from that company should be brought, original deregistered card, vehicle
inspection report, photo copy of ID and one passport size photo. If the vehicle was exported and
now is returned the owner should bring the Interpol letter used while he or she was asking for
deregistration, headed paper he or she was given by the authority while the vehicle was
deregistered, vehicle inspection report, photocopy of ID, original deregistration card and one
passport size. The amount charged for Reregistration is Tsh 50,000/=.
2.1.4 Change of Motor vehicle Ownership
Manual recording of change of ownership of motor vehicle in a special book of registration that
has several columns of a name of the tax payer who is the new owner of that changed of
ownership motor vehicle, TIN, motor vehicle registration number, card number offered by the
authority, amount paid for registration, reason ( which is change of ownership ), telephone
number, name, signature and the date where the card is taken, those particulars are for the one
who will come to take the registration card from our office because sometimes a motor vehicle
owner can send a representative to take a card on his or her behalf so for any inconvenience the
one who came to take the card will be held answerable.
Lesson learnt.

The owner of the vehicle (seller) is the one who is supposed to come to process the change of his
or her motor vehicle ownership and not the buyer, if the owner is un available a tax officer will
use TIN to obtain telephone number and call the owner for justification. Documents required for
ownership change is original motor vehicle registration card which should be signed by both
parties (seller and buyer), sells agreement document stamped by a lawyer, one pass port size
photo from each part, photocopy of national ID and if the vehicle was for commercial purposes
the tax clearance certificate. The amount charged for transfer of ownership is Tsh 50,000/= for
registration card, Tsh 50,000/= for transfer fee and 1% of selling amount as a stamp duty.

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2.1.5 Change of Motor Vehicle Particulars
Manual recording of a changed motor vehicle particulars in a special book of registration that has
several columns of a name of the tax payer who is the owner of that motor vehicle, TIN, motor
vehicle registration number, card number offered by the authority, amount paid for change of
particulars, reason ( which is change of particulars ), telephone number, name, signature and the
date where the card is taken, those particulars are for the one who will come to take the card
from our office because sometimes a motor vehicle owner can send a representative to take a
card on his or her behalf so for any inconvenience the one who came to take the card will be held
answerable.
Lesson learnt.

Particulars changed may be motor vehicle’s color, axel, engine and body type. A tax payer is
required to change the particular he or she wishes to change and thereafter to bring the vehicle to
the authority office for inspection. Original motor vehicle registration card should be brought to
the office because it is the one that contains details of the vehicle before the new changes a tax
officer will inspect the vehicle and to see if the differences stated by the tax payer are true since a
tax payer in writing should state how his or her vehicle was and the changes he or she made.
Other documents required are EFD tax invoice from the garage which did the changes, colored
pictures of the vehicle before changes, one passport size and photocopy of national ID as well as
tax clearance certificate if the vehicle was for commercial purposes. The amount charged for
change of motor vehicle particulars is Tsh 50,000/=.

2.1.6 Motorbike Reallocation.

Manual recording of Reallocated motorbike in a special book of registration that has several
columns of a name of the tax payer who is the owner of reallocated motorbike, TIN, motorbike
registration number, card number offered by the authority, amount paid for motorbike
reallocation, reason ( which is motorbike reallocation ), telephone number, name, signature and
the date where the card is taken, those particulars are for the one who will come to take the card
from our office because sometimes a motor vehicle owner can send a representative to take a

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card on his or her behalf so for any inconvenience the one who came to take the card will be held
answerable.
Lesson learnt.

All motorbikes whose registration numbers start with “ T “ registration number for example T
195 JJM should be changed to “ MC “ since only cars will be allowed to use “T” registration
number. So from the example above the motorbike registration number was changed from T 195
JJM to MC 195 JJM hence the reason Motorbike Reallocation. The amount paid for each
motorbike reallocation is Tshs 22,500/= for motorcycles and Tshs 32,500/= for
motortricycle( Bajaj ). And since the motorbike reallocation is the order from the government for
all motorbike to change their registration number from “ T “ to “ MC “ no motorbike shall be
allowed to continue working while having ” T” registration number.

2.1.7 Motor vehicleCustoms paid update

Manual recording of customs paid update motor vehicle in a special book of registration that has
several columns of a name of the tax payer who is the owner of vehicle, TIN, motor vehicle
registration number, card number offered by the authority, amount paid for motor vehicle
customs paid update, reason ( which is customs paid update ), telephone number, name, signature
and the date where the card is taken, those particulars are for the one who will come to take the
card from our office because sometimes a motor vehicle owner can send a representative to take
a card on his or her behalf so for any inconvenience the one who came to take the card will be
held answerable.

Lesson learnt.

Motor vehicle customs paid update is only applicable to those companies which have tax
exemptions. From those exemptions a company is required to pay a small amount of money for
motor vehicles registration and the rest of amount remaining for registration will be upon the
government, the rest of the amount is upon the government because it is the one which offers
those exemptions to those companies. The amount charged for motorvehicle customs paid update
is Tshs 50,000/= only regardless the motor vehicle’s capacity “cc” for instance a motor vehicle
with 2501cc and above its registration fee is Tshs 550,000/= the company with exemption will
pay only Tshs 50,000/= and Tshs 500,000/= is upon the government.

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2.1.8 Blocking of Motor Vehicle

Manual recording of blocked Motor vehicle in a special book of registration that has several
columns of a name of the tax payer who is the owner of the vehicle, TIN, motor vehicle
registration number, reason ( which is blocked ).
Lesson learnt.

It is important to state the reason of blocking the motor vehicle in the system before blocking it,
the reasons maybe fake registration thus motor vehicle was not registered in a way which adhere
the Authority qualifications, the vehicle has been subjected for criminal issues or the owner of
the vehicle has outstanding payments with the Authority. The motor vehicle can be blocked
using their registration number, chasis number or an engine number because all those are
different from one motor vehicle to another. After the motor vehicle is successfully blocked the
tax officer is required to make a copy and file a document of request to block the vehicle in a
special file of blocked vehicles manually for reference purposes. No card is issued for blocked
vehicle as well as no amount of money will be paid for the service.

2.1.9 Motor vehicle title holder amendment

Manual recording of amended title holder motor vehicle in a special book of registration that has
several columns of a name of the tax payer who is the owner of motor vehicle, TIN, motor
vehicle registration number, card number offered by the authority, amount paid for title holder
amendment, reason ( which is amend title holder), telephone number, name, signature and the
date where the card is taken, those particulars are for the one who will come to take the card
from our office because sometimes a motor vehicle owner can send a representative to take a
card on his or her behalf so for any inconvenience the one who came to take the card will be held
answerable.
Lesson learnt.
Title holder amendment is to the motor vehicle where by its owner took a loan from a financial
institution and make his or her car a bond so as when he or she finish the loan the car will be his
or hers again and if not the financial institution will be the owner of that particular vehicle. Upon
the process of amending the title holder both the vehicle owner and a representative from a

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financial institution should be physically present at the office. The owner should submit the
original registration card of the vehicle, one passport size photo and a photocopy of National
Identity card for both parties and for the representative a photocopy of identity card from the
institution he or she is working to. After tax officer is satisfied with the information and
requirement provided by both parties he or she can now amend the title. The amount charged for
title holder amendment is Tsh 50,000/= for each motor vehicle brought for the purpose in case
there is more than one vehicle. No motor vehicle title should be amended if both of the part is not
present to process the changes so as to prevent fraud.
2.1.10 Selling of Revenue Stamps

Selling of revenue stamps to tax payers in need of them of which a single revenue stamp cost
five hundred Tanzania shilling only ( Tshs 500/= )

Lesson learnt.
Revenue stamps are important in verification pf registration card because original card is not
used during verification only their copy before the court of law. The motor vehicle owner is
required to make a copy of the original registration card and affix in the stamp usually two
stamps in each copy he or she wishes to verify and the owner is also required to stamp the copies
from a lawyer or any court of law.
2.1.11 Printing of control numbers
Printing control numbers for various tax payment up on motor vehicles new registration, motor
vehiclechange of ownership, motor vehicle change of particulars, motorbike reallocation and
motor vehicles customs paid update.
Lesson learnt.
Before the control number is given the tax officer should assess the motor vehicle so that the
required and appropriate amount to be displayed on the system. If no assessment is done there
will be no control number displayed for payment rather the system will provide the information
of “ No Assessment for vehicle XXXXXX”

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2.2Challenges

2.2.1Challenge encountered in the field

2.2.1.1 Lack of enough education to Taxpayers on different tax laws leading to tax frauds for
example amount to charged for billboard and laws governing non tax revenue collection.
TRA should have the tendency of providing enough education to the people in order to make
them aware on what is going on and its importance to the people.
2.2.1.2 Network failure, power problems and shortage of operation equipment’s like enough
computers leading to inefficient in daily operation in the office.
2.2.1.3 Taxpayer’s failure to cooperate with TRA Officers like provision of wrong
information, don’t come to collect their slips and control number
2.2.1.4 Climate problems, during rainy and intensive sun shine disparages block operations
this is only because most of the operations are in streets.

2.3.1 Challenges encountered as a student

2.3.1.2 Lack of trust from tax payers in outside operations due to lack of Authority
Identification Card and sometimes lack of corporation from TRA officers. Some of
taxpayers refused to co operate with me and my fellow field students due to the fact
that we did not have any identification of being tax officer as known because a tax
officer should have an identity card. So this was sometimes discouraging.
2.3.1.3 Financial problems in terms of meals and transport fund leading to late attendance
and inefficiency to some days. As for me my home place is in Temeke district and my
practical training is in Ilala district, I was supposed to pay my bus fare every day to
and from the office which was expensive to me.
2.3.1.4 TRA specification of sections and late arrangement in different section (rotation)
leading to minimum competence to other sections.
Insufficient coverage in class lectures compared to field practical tasks. The time I was on field
training there were a lot of activities that I did not learn at class as I was in year two of bachelor
degree, so this led me to unfamiliarity of some activities of which I was unable to compare with
the theory I have to the practical training

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General comments

1. Insert a cover page

2. Consider writing skills and formats including font type, font size, line spacing, etc.

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